Contacts

Air Ambulances

Last Updated 1/14/19

Issue: Air ambulances are used to quickly transport patients in life-threatening situations. Air ambulances are usually helicopters equipped with medical equipment and staffed by medical professionals just like traditional ground ambulances. According to the Association of Air Medical Services, more than 550,000 patients in the U.S. use air ambulance services every year. Air ambulance services have grown significantly in recent decades; in 2002 there were approximately 400 dedicated air ambulances, but by 2008 the number had more than doubled to over 800. Possible reasons for the growth of this industry include an aging population, a decline in the number of emergency departments in existing hospitals, and changes in the delivery of health care in rural settings. There are also concerns that such high growth in this industry may be an indicator of medically unnecessary use.

Costs for the average air ambulance trip run in the tens-of-thousands of dollars. These high costs can be attributed to maintenance of expensive equipment as well as the need to staff specialized medical personnel around-the-clock.

Background: The Airline Deregulation Act of 1978 (ADA), originally passed with the intent of encouraging competition in the airline industry, prohibits states from regulating the prices air carriers charge. As such, any state laws passed to regulate the costs of air ambulance services are preempted by the ADA. In contrast, traditional ground ambulance services are regulated under the ACA as well as any applicable state laws.

Over the past decade, many states have reported issues with air ambulance providers not affiliated with any hospital or insurance carrier. This leaves patients in some areas with no in-network choices for life-saving care while out-of-network air ambulance providers can leave patients with enormous bills. Additionally, although Medicare, Medicaid, and most private insurers provide some coverage for air ambulance services, reimbursement rates are often far lower than what air ambulance providers bill. This can lead to a practice known as balance billing where a provider bills the patient directly for any amount not covered by insurance. These bills can be tens-of-thousands of dollars.

In lieu of Congressional action on this issue, some states have looked for alternative ways to help protect consumers from extremely high bills. However, almost all state legislation in this area has been preempted by the federal ADA.

Ultimately, federal legislation is needed to provide a workaround to the ADA.

Status: The FAA Reauthorization Act of 2018 includes a provision to appoint an advisory committee on air ambulances and patient billing. The U.S. Department of Transportation is expected to establish the committee in early 2019. NAIC Government Relations will follow the committee's progress closely.